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Bank Industry Risk Analysis: Malaysia Oct 02
Standard & Poors, Oct 2002
Abstract
By international standards, risks in Malaysia's banking and finance industry are higher than average. The key risks in the system are the country's developing economy, cyclical propensity for corporate borrowers to overleverage, corporate governance issues arising from many major borrowers being controlled by an individual, and regulatory forbearance. More positively, an industry structure allowing for moderate competition, and demonstrated system support by the government, are mitigating elements. Bank ownership continues to be a mixed rating factor. Although some banks are institutionally owned, others remain influenced by a single individual or family shareholder, a setup that is less likely to foster professional management. The Malaysian banking landscape underwent substantial transformation in late 1999, where as part of the first phase of...
Companies mentioned in this report are: Malayan Banking Bhd.,Public Bank Bhd.,Affin Bank Berhad,RHB Bank Bhd.,CIMB Bank Bhd.,Southern Bank Berhad,Hong Leong Bank Bhd. (Unsolicited Ratings),Alliance Bank Malaysia Berhad,AmInvestment Bank Bhd.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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